WELLESLEY, Mass.--(BUSINESS WIRE)--Wellesley Asset Management is announcing a reduction of net management fees for the Miller Convertible Plus Fund from 1.95% to .95% reflecting the company’s commitment to improving value and seeking strong investment returns for our clients. The new management fee took effect on November 1, 2019.
The Miller Convertible Plus Fund utilizes leverage to maximize returns with our conservative convertible bond strategy. The goal of the Fund is to primarily deploy leveraged convertible bonds to outperform both equity and fixed income investments over complete market cycles.
The Fund draws on over 25 years of convertible bond experience of the Fund’s investment advisor, Wellesley Asset Management, Inc., which has over $2 billion in assets under management as of 9/30/2019.
“We are confident a reduction in management fees combined with leverage added to Wellesley’s conservative approach to convertible bonds can provide meaningful value to our shareholders going forward,” said Greg Miller CPA, Founder, Chairman and CEO of Wellesley Asset Management.
The table below describes the new fees and expenses that you may pay if you buy and hold shares of the Fund.
Annual Fund Operating Expenses (expenses that you pay each year as a percentage of the value of your investment) |
Class I |
Management Fees(1) |
1.40% |
Distribution and/or Service (12b-1) Fees |
0.00% |
Other Expenses |
0.22% |
Leverage Expenses |
1.51% |
Acquired Fund Fees and Expenses |
0.01% |
Total Annual Fund Operating Expenses |
3.14% |
(1) The Fund’s Investment Advisory Agreement provides for an advisory fee to accrue at an annualized base rate of 0.95% of the Fund’s average daily “managed assets,” which equal its total assets including assets attributable to borrowings, minus accrued liabilities other than borrowings (“Managed Assets”). The “Management Fee” recorded in the above table shows the advisory fee as a percentage of the Fund’s average daily net assets, not Managed Assets. During the Fund’s previous fiscal year, the Fund’s average daily managed assets were equal to 147% of its net assets. Because Managed Assets are greater than net assets, the percentage rate recorded in the table is greater than the contractual percentage rate in the Fund’s Investment Advisory Agreement.
About Risk
Investments in convertible securities subject the Fund to the risks associated with both fixed-income securities, including credit risk and interest risk, and common stocks. A portion of the Fund’s convertible securities may be rated below investment grade. Exchangeable and synthetic convertible securities may be more volatile and less liquid than traditional convertible securities. In general, stock and other equity security values fluctuate, and sometimes widely fluctuate, in response to activities specific to the company as well as general market, economic and political conditions. Lower rated fixed-income securities are subject to greater risk of loss of income and principal than higher-rated securities. The prices of lower rated bonds are likely to be more sensitive to adverse economic changes or individual corporate developments. All fixed-income securities are subject to two types of risk: credit risk and interest rate risk. When the general level of interest rates goes up, the prices of most fixed-income securities go down. When the general level of interest rates goes down, the prices of most fixed income securities go up. The Fund may invest a significant amount of its assets in a particular industry, market, or sector. The value of its shares may be more susceptible to adverse changes within that market or sector than a Fund that does not focus its investments.
Leverage Disclosure
The use of leverage through activities such as borrowing can magnify the effects of changes in the value of the Fund and make the Fund’s share price more volatile and sensitive to market movements. Because leverage increases the fees payable to the adviser, Wellesley Asset Management has an incentive to increase the Fund’s use of leverage.
Investors should carefully consider the investment objectives, risks, charges and expenses of the Miller Convertible Plus Fund. This and other important information about the Fund are contained in the prospectus, which can be obtained by calling 781-416-4000. The prospectus should be read carefully before investing. The Miller Convertible Plus Fund is distributed by Northern Lights Distributors, LLC, member FINRA/SIPC. Wellesley Asset Management, Inc. and Northern Lights Distributors, LLC are not affiliated entities.
